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May 1, 2008updated 12 Apr 2017 4:46pm

£30m of business expected in new HSBC-3 Step tie-up

After a long hiatus from the IT equipment leasing business, HSBC is now back in the game, with a new tie-up with the Finnish IT services group, 3 Step IT.

By Maryann Tan

After a long hiatus from the IT equipment leasing business, HSBC is now back in the game, with a new tie-up with the Finnish IT services group, 3 Step IT.

HSBC is aiming to generate at least £30m in leasing volume over the next two years with the 3 Step partnership.

“We haven’t been in the IT leasing market, for a long time,” said Paul Meredith, HSBC’s head of IT Finance. “To be honest we had grown the business in so many other directions but this (IT) just wasn’t priority.”

New business for HSBC is expected to originate from the bank’s existing customer base as well through referrals from 3 Step.

“At the moment, the product will be delivered through our existing sales force. The intention is not, at this time, to create a specialist team looking purely at this. It’s giving the existing guys another tool in their bag. So when they fund a customer’s machinery say, they can also ask them about IT funding needs,” Meredith said.

As a specialist in IT lifecycle management, 3 Step helps companies with the entire process of IT systems implementation from the point of acquisition to the end of a system’s useful life. Crucially, it provides hardware tracking, data destruction and the safe disposal of hardware at the expiry of its useful life.

According to Jon Davies, director at 3 Step IT UK, the lifecycle approach to managing IT systems is not a new practise but it was only in the past 24 months that it has become much more prominent.

“The drivers behind it is really customers recognising that they can have cost savings through standardisation,” he says. “The other factor is the need for its environmentally conscious disposal and the prevention of data leaks.”

But for HSBC, perhaps the strongest aspect of the partnership is that 3 Step has the ability to take on residual value risk. Davies notes that even a three-year-old PC has value to 3 Step – part of its business involves refurbishing used IT equipment and reselling them.

Clearly, this makes IT financing for a generalist like HSBC that much easier. Potentially, it could also allow HSBC to offer operating lease contracts for IT equipment to its customers since 3 Step is there to take on the risk.

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